Fidelity Bonds and Commercial Crime Policies

Fraudulent Wire Transfers

• Secured two rulings in favor of the insured for losses resulting from a business email compromise and a fraudulent wire transfer. The District Court and Court of Appeals ruled that the loss was covered under a crime insurance policy. At that time, these were two of the only pro-policyholder rulings on this point in the country, and those rulings remain the leading pro-policyholder decisions regarding funds transfer fraud coverage phishing losses.
• Served as lead counsel providing insurance coverage advice for company suffering business email compromise and wire fraud. Helped client obtain full coverage for losses under crime insurance policy.

Computer-Related Fraud

• Served as lead counsel to a manufacturer that suffered a computer hacking, data destruction, and theft and circulation of confidential information. Won a summary judgment ruling that a crime insurance policy provided coverage for the losses. The matter settled at mediation, with the summary judgment decisions vacated as a result.
• Served as lead counsel to a financial institution that suffered financial losses as a result of hacking and unauthorized access to and manipulation of accounts. The matter settled at mediation without litigation.

Employee Theft and Dishonesty

• In this action, the insured suffered losses stemming from alleged thefts and forgeries at a company that the insured owned. Defeated the insurance carrier’s motion to dismiss, with the court ruling that the insurance policy language was ambiguous, and obtained a favorable ruling on a motion to compel. The matter settled at mediation.
• In this action, the firm obtained a court ruling denying summary judgment for the insurer under Employee Dishonesty/Employee Theft coverage. The client’s employee committed theft in collaboration with employees of the client’s vendor through submission of, and approval of payment for, inflated invoices. The firm defeated summary judgment for the insurer, with the Court holding that the availability of coverage was a question of fact. The case subsequently settled.
• Represented a bank in successful litigation for coverage under a bankers blanket bond. The bank issued a loan that was to be used to finance renovation and continued operation of a hotel, the borrowers absconded with the money and abandoned the hotel. Another law firm initially represented the bank and had the bank’s president sign a sworn proof of loss contending that coverage was available for “employee dishonesty” because the bank’s loan officer participated in the fraud. After another firm failed to win coverage or the client, our attorneys took over the case and convinced the court to allow a change in coverage theory, namely that the loss was caused by “forgery” because the borrowers had altered the hotel’s financial statements submitted to the bank’s loan committee. After defeating the insurance company’s renewed motion to dismiss, our attorneys obtained a significant settlement for the bank.
• Represented multiple clients dealing with complex financial fraud schemes engineered by former employees and assisted those clients with resolving those claims via claims handling and litigation efforts.